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How to buy KyberNetwork
A guide to KyberNetwork, how it works and how to buy, sell and trade KyberNetwork Crystal (KNC).
KyberNetwork is a trustless, decentralised cryptocurrency exchange. This Ethereum-based protocol is designed to provide the instant exchange of digital assets and cryptocurrencies with high liquidity.
The KyberNetwork Crystal token (KNC) is used to pay fees on the KyberNetwork platform. To find out how these tokens work, what affects their value and how you can buy KNC in New Zealand, keep reading.
Where to buy, sell and trade KNC
KNC is available on a number of popular cryptocurrency exchanges, such as the following:
How to buy KNC: A step-by-step guide
If you’d like to buy KNC in New Zealand, here’s an example of how you can do it:
Step 1. Register for an account with an exchange that allows you to buy KNC
To get started, search for an exchange that lists KNC in one or more currency pairings. You’ll then need to sign up for an account by entering your email address and creating a password.
Many exchanges will require your full name, contact details and a valid form of photo ID before you can deposit funds and start trading. We also recommend enabling 2-factor authentication on your account for an added layer of security.
Step 2. Deposit funds into your account
It’s not currently possible to exchange New Zealand dollars (NZD) for KNC. As a result, you will have to first acquire a crypto that’s listed in a currency pairing with KNC, for example Ether (ETH) or bitcoin (BTC), and then exchange it for KNC. An exchange like Binance allows you to do this.
Step 3. Buy KNC
Now it’s time to click through to the markets section of your chosen exchange and search for your desired currency pairing. If you’re using Binance, navigate to the “Funds” tab and choose “Deposits/Withdrawals”. From there you will see a list of supported currencies. Find KNC and click the “Deposit” button.
Before confirming your purchase, make sure you review the full details of the transaction and that you’re happy with the total cost.
How to sell KNC
The process for selling KNC is essentially the same as the process outlined in step 3 above, but in reverse. However, it’s also important to be aware that cryptocurrency exchanges only offer specific currency pairings, so it may not be possible to directly exchange your KNC for your desired currency.
KNC tokens are ERC20-compliant tokens on the Ethereum network and can be stored in any Ethereum-compliant wallet, such as the following:
How KyberNetwork works
Announced in 2017, KyberNetwork is the brainchild of blockchain technology developers Loi Luu, Yaron Velner and Victor Tran. Vitalik Buterin, the founder and chief scientist of Ethereum, is also listed as an advisor. Its ICO was held in September 2017 and made headlines after raising around US$60 million in a little over a day.
Central exchanges are unable to provide instant transfers as well as being vulnerable to internal fraud and external hacking. To combat this, the developers set out to create a decentralised exchange that allows for the instant exchange and conversion of cryptocurrency coins and tokens.
The aim of KyberNetwork is to allow users to hold coins in their own wallets and to exchange them instantly for other tokens using smart contracts. KyberNetwork claims this will allow it to offer the following:
- The ability to transfer tokens to anyone
- The ability to pay someone else in any token, using the tokens you own
- Instant trades with no waiting around to receive your tokens
- High liquidity (rather than maintaining a global order book, KyberNetwork maintains a reserve warehouse which holds an appropriate amount of crypto tokens)
- Trustless trading on a network that is secure against attacks
- Compatibility with existing smart contracts
What to consider before you buy KNC
Buying cryptocurrency is complicated and speculative, with several risks you need to be aware of before you purchase any cryptos. If you’re thinking of buying KNC, make sure you take the following factors into consideration first:
- Supply. A total of 226,000,000 KNC were minted during the KyberNetwork ICO, with a little over 61% of that amount distributed to public participants. According to CoinMarketCap, at the time of writing (23 January 2018) there were 134,132,697 KNC in circulation.
- Token use. A reserve manager maintains the reserve of tokens, determines exchange rates and feeds the rates to the KyberNetwork. KNC tokens are needed to operate a reserve, with a small KNC fee charged to the reserve each time an exchange takes place. Those fees cover network operational costs and are also used to reward third parties (for example wallets and blockchain explorers) that introduce additional trade volume to the platform.
- Burning of tokens. Once the KNC tokens generated from fees have been used to cover operational costs and reward third parties, those tokens will be taken out of circulation. This will eventually cause the circulating supply of KNC to decrease.
- Commercial partnerships. It’s important to stay abreast of the commercial partnerships any crypto has with other companies and their potential for growth and development. For example, KyberNetwork has recently partnered with interconnecting blockchain network ICON and Ethereum payment service Coinduck.
- Roadmap. If you want to know what future technological developments are scheduled for KyberNetwork, check out the “Roadmap” section on the company’s website. For example, support for cross-chain trading is slated for introduction in early 2019, which means that in the short term, KyberNetwork will only be able to support the trading of ERC20 tokens.
- Market competition. It’s also important to consider the competition KyberNetwork will face from other companies operating in the same sector. For example, OmiseGO and 0x are two other cryptocurrency exchange projects worth researching.
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